Sir Martin Sorrell’s S4 Capital Announces “Post-Pandemic Bounce” in Economy S4 Capital
Sir Martin Sorrell’s advertising and marketing firm S4 Capital reported booming business amid what it described as a ‘post-pandemic rebound’ in the global economy as ‘it is preparing for its expansion.
S4 said gross profit and comparable income were both at “beyond expectations” levels, in a statement to the stock exchange on Monday.
He added that “activity continued at unprecedented levels in May and June, driven both by the post-pandemic rebound in global GDP and the acceleration of digital marketing transformation.”
Much of the world is still in the grip of the coronavirus pandemic, but advertising spending is increasing in some places. Restrictions are easing in some markets, including the United Kingdom, which on Monday dropped all social distancing regulations, despite the growing presence of the Delta variant which is proving contagious even to many vaccinated people.
Sorrell created S4 in 2018. He had previously left WPP, the FTSE 100 marketing conglomerate that he had built from the shell of a manufacturer of wire and plastic products, after staff made allegations of personal misconduct. Sorrell has denied any wrongdoing.
Since then, Sorrell has embarked on a rapid series of acquisitions to develop a digital-focused rival to his former company. The strategy benefited from the abandonment of print advertising during the pandemic. In May, S4 raised its revenue targets and Sorrell said he was “extremely optimistic” about the economic recovery.
On Monday, S4 said it had secured new loan and debt facilities to refinance existing borrowings as well as to pursue new acquisitions. The company has entered into a seven-year loan of 375 million euros (£ 321 million) with Credit Suisse, HSBC and Barclays, as well as a five-year revolving credit facility that could allow the company to borrow up to £ 100 million from Credit Suisse, HSBC, Barclays. , JP Morgan and BNP Paribas.
The money will refinance existing borrowing facilities worth £ 109million and give him an additional £ 200million which he intends to use in part to fund further acquisitions. S4 said it plans to expand its business in technology services as well as add content, data and digital media to its businesses in the Americas and Asia-Pacific.